USDA Announces MFP Payments

Courtesy AgriPulse 2019

The Trump Administration has committed to paying US farmers aid payments to help subsidize the losses caused by the trade war with China. According to the USDA, "The Market Facilitation Program (MFP), Food Purchase and Distribution Program (FPDP), and Agricultural Trade Promotion Program (ATP) will assist agricultural producers while President Trump works to address long-standing market access barriers." Under the Market Facilitation Program (MFP), these payments will range from $15 to $150 per acre depending on the type of non-specialty row crop and the county in which the crop is located.

As reported by AgriPulse on July 26, 2019 -

"The rates are based on the mix of crops that each county historically produces as well as USDA's calculation of the impact on each commodity of unfair trade practices over the past 10 years.

Some of the largest per-acre payments will go to counties dominated by cotton production. Agriculture Secretary Sonny Perdue acknowledged that there were differences between counties and regions but said that basing payments on county rates was the fairest way to distribute the trade aid.

“Aside from doing individual calculations on every producer in the country, there are going to be some misalignments probably in this program somewhere,” Perdue told reporters Thursday. “We spent hours and hours and hours trying to mitigate and reduce any disparities that were outstanding.”

The minimum and maximum levels, Perdue noted, were “an attempt to equitably distribute” the more than $14 billion in authorized direct payments to producers.

County rates are highest in areas where cotton is a staple crop such as Georgia and Texas and much lower across Corn Belt states in the Midwest. No counties in Ohio, Indiana, Illinois, Iowa, Nebraska, Minnesota, and the Dakotas have payment rates above $100 an acre, but Texas and Georgia have 35 and 51 respectively.

USDA will also distribute minimum payments of $15 per acre to producers who planted cover crops on prevented planting land, but the amount of acres expected to qualify is not yet known.

The county payment rates are set for “non-specialty crops,” which USDA terms to be alfalfa hay, barley, canola, corn, crambe, dried beans, dry peas, extra-long staple cotton, flaxseed, lentils, long grain and medium grain rice, millet, mustard seed, oats, peanuts, rapeseed, rye, safflower, sesame seed, small and large chickpeas, sorghum, soybeans, sunflower seed, temperate japonica rice, triticale, upland cotton, and wheat."

We have put together a list of online articles for our subscribers to gain further insight and knowledge into the MFP, and other three programs, which are being administered through the USDA in facilitation of the additional farm subsidy programs to offset losses due to the ongoing trade wars.

https://www.agweb.com/blog/mfp-payments-announced-today-here-are-key-provisions

http://www.uky.edu/Ag/AgEcon/pubs/extMFP090418Davis02.pdf

https://www.usda.gov/media/press-releases/2019/07/25/usda-announces-details-support-package-farmers

https://www.agri-pulse.com/articles/12454-usda-announces-county-rates-for-2019-mfp-payments